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When Apple users were part of a devoted cult, they were willing to put up with the way Apple does business - never admitting problems (until now), keeping its users in the dark about serious bugs even when its own discussion forums are filled with dozens of people struggling to fix the issues. But the iPhone and the resurgence of the Mac have brought in millions of new customers from the world of Microsoft, and they’re not willing to give Steve Jobs a pass when the technology they depend on fails to work right. They’ve seen this movie before — Microsoft Vista — and it doesn’t have a happy ending.

Apple is having serious quality control problems with the iPhone 4 going well beyond the antennae problem that being discussed at the press conference Apple is holding at this moment. There are at least two severe problems with iOS4, the upgraded operating system that runs the iPhone. Most of the millions of existing iPhone 3G and 3Gs customers will update their OS, as they will be prompted to do automatically, and wish they didn’t.

iOS4 is excruciatingly slow on the iPhone 3G, starting with the several seconds it takes to unlock the phone. Switching between apps can be glacial, to the point where I’m less likely to use the app at all. Users are struggling to figure out how to revert to iOS3 while keeping their data intact.

Worse still, people who own both an iPhone and a Mac – i.e., Apple’s best customers – have had their calendars screwed up by a syncing bug between the iPhone’s Calendar app and Mac’s iCal. If you’re a busy person who depends on these applications to keep track of dozens of upcoming appointments and other important tasks and your calendar stops working reliably, that’s a very, very big problem.

Apple, as always, won’t acknowledge the problems, even on its own forums, and customers are very unhappy (see http://discussions.apple.com/thread.jspa?threadID=2495372 for the calendar problem and http://discussions.apple.com/thread.jspa?messageID=11919484&tstart=0 for the slow performance problem).

My suggestion to Apple? Stop thinking that the rules no longer apply to you, and start being more honest with your customers.

When we work to help clients through a communications crisis, we advise them to stop the slow leak of damaging news and come clean. If your product or the behavior of some employees doesn’t meet the company’s standards, your customers and employees need to hear that from you. Then show you’re doing everything you can to fix the problems – and get them fixed. Otherwise each bit of negative news will trigger a new news cycle built on the story line that this is a company in crisis (see Toyota).

Does anyone feel like they are watching the Apple-version of LeBron’s ”Decision?”  Sure, one is a device and one is an athlete - but they are both monumental brands in their respective industries being faced with very difficult decisions.

It is hard to argue that both the iPhone 4 and LeBron are at the top of their game – sure there are others great players, but these are the two heavyweights of their markets and its not very often they have been tested the way they are now.

Almost every man, woman and child (even those of outside of Cleveland, New York and Miami) are aware of the drama and speculation surrounding the free agency choice LeBron James made last week.  It has become a parody many cannot resist having some fun with (my favorite being the skit from the ESPYs last night) and has drawn the attention and commentary of celebrities, politicians and just about anyone with a blog and remote interest in basketball.

Equally so, almost everyone knows about the iPhone 4 antenna issue.  The way the iPhone 4 antenna “problem” has played out over the last two weeks feels very similar to me to the LeBron “Decision.”  Both spurred great excitement around their arrival (iPhone 4 hitting the market and the day LeBron became an official free agent).  Both had to make big decisions in very small time frames.  Both are on the receiving end of mass media and public pressures (where to play? what to do? when to do it?).

With the LeBron decision already made, here are a few things I think Apple can learn…

• Take your time, but not too much: I’m not arguing that either party is taking too long, but responding in a timely manner is very important.  One report I read yesterday stated that Apple lost approx. $5B in market valuation since the issue started.  Not to say a company like Apple they can’t regain that, but it is a steep price to pay.  The longer you wait, the more the speculation will mount, the opinions of what you should/could/would/may want to do will pile up — and your ultimate decision will be criticized or debated. 
• Stick to your brand/what you do best: LeBron went into uncharted territory with his one hour ESPN special and it wasn’t well received.  When I heard LeBron would host a one hour event on ESPN from Greenwich, CT, I was quite surprised.  The location (Boys & Girls Club was great - but Greenwich?), the format, the tone, etc. just felt packaged and it was wrapped in a commercial way that just didn’t feel right.  I was equally surprised this morning when I saw that Apple is now hosting an press conference tomorrow.  This seems very non-Apple to me, but the situation they are in is very non-Apple.  My hunch is that they stay true to their roots in how they manage this conference.  This will certainly be challenging for them as they’ll have to walk a fine-line between swagger and style and the more serious issue of what they plan to do to address the issue.
• Get to the point: If you watched the LeBron ESPN one hour special about 15 minutes into it — you suddenly realized this was a 60 minute show, to find out a 20 second (or less) answer.  Q: “Where are you going to play next year?”  A: “Miami.”  Done.  People want answers around what you’re going to do and the why you’re doing it can follow (the details are still very important). Apple would do well to be up-front about this, provide the answer and then the right amount of details to follow.

Ultimately, how you handle your “decision” is quickly becoming almost as important as what you actually decide to do, but hopefully they’ll do it quickly, directly and with a bit of Apple style.

Now, lets sit back and wait for the next round of “The Decision” to play out…